CURRENT TOPICS.

The jurisdiction of courts over societies was considered by the Master of Rolls in the late English case of Rigby v. Connell, 28 W. R. 650, in which the status of a modern institution, to wit, the trade-union, was considered. A member of a trade-union brought an action against the officials thereof claiming damages for wrongful expulsion from the society, and also an injunction. The court held that the action was not maintainable, placing its decision partly on the ground that some of the rules of the union were in restraint of trade, but more particularly on the ground that there was no allegation that the union possessed any property, which was the only foundation of the jurisdiciion of the court to interfere. "There is no such jurisdiction that I am aware of," said Jessel, M. R., reposed in any court of this country, at least in any of the Queen's courts, to decide upon the rights of persons to associate together when the assoation possesses no property. Persons may, and many persons do, associate together without any property in common at all. A dozen persons may agree to meet and play whist at each other's houses for a certain period, and if eleven of them refuse to associate with the twelfth any longer, I am not aware of any jurisdiction in any court to interfere. Or a number of scientific men may agree in the same way to meet at any place; but if the association has no property and takes no subscriptions from its members, I can not imagine that any court of justice could interfere with such an association if some of the members declined to associate with some of the others. That is to say, the courts never dreamt of enforcing what I may call personal agreements-that is, agreements strictly personal in their nature, whether they are agreements of hiring and service, being the common relation of master and servant, or whether for the purpose of pleasure or of scientific pursuits, or for the purpose of charity or philanthropy. No court of justice can interfere so long as there is no property the rights to which are taken away from the person complaining. Now, if that is the foundation of the jurisdiction, the plaintiff, if he succeeds at all, must succeed on the ground that some rights of property to which he was entitled have been taken away from him. That this is the foundation of the interference of the courts as regards clubs I think is quite clear, for if you look at the Lord Chancellor's judgment in Re St. James' Club, 2 De G. M. & G. 387. you will see that he puts it thus-that the member had an interest in the assets of the club. Similarly in the case of Hopkinson v. Marquis of Exeter, 16 W. R. 266, L. R. 5 Eq. 66, Lord Romilly starts with the right to the enjoyment of the club property; and the subsequent cases have gone on the same ground."

Except for the activity of the Federal courts of the Pacific Coast in declaring certain statutes unconstitutional, a Chinaman's lot under the laws of California would hardly be a happy one. One section of the new Constitution forbade the employment of Chinese by any corporation, or on any State, county, municipal or other public work; but this was held unconstitutional in Parrott's Case. But there are other laws now in force there equally as onerous. One is entitled "an act to provide for the removal of Chinese whose presence is dangerous to the well-being of communities outside the limits of cities and towns in the State of California," in which it is provided that "the board of trustees or other legislative authority

of any incorporated city or town, and the board of supervisors of any incorporated city and county, are hereby granted the power, and it is hereby made their duty to pass and enforce any and all acts or ordinances or resolutions necessary to cause the removal without the limits of such cities and towns, or city and county, of any Chinese now within or hereafter to come within such limits." Another act is entitled "an act to prohibit the issuance of licenses to aliens not eligible to become electors of the State of California,'' which provides as follows: "No license to transact any business or occupation shall be granted or issued by the State, or any county or city, or city and county, or town, or any municipal corporation, to any alien not eligible to become an elector of this State. A violation of these provisions shall be deemed a misdemeanor,and be punished accordingly." Still another act, entitled "an act relating to fishing in the waters of this State,'' provides as follows: "All aliens incapable of becoming electors of this State are hereby prohibited from fishing, or taking any fish, lobsters, shrimps, or shell fish of any kind for the purpose of selling or giving to another person to sell. Every violation of the provisions of this act shall be a misdemeanor, punishable upon conviction by a fine of not less than $25, or by imprisonment in the county jail for a period of not less than thirty days.''

In the case of Ah Chong, decided in the United States Circuit Court for the District of California, this last statute was declared in conflict not only with our treaties with China but also with the Fourteenth Amendment. The court distinguished the case before it from that of McCready v. Virginia, 94 U. S. 391, 4 Cent. L. J. 578, where a statute of Virginia making it an offense for citizens of other States to take oysters from or plant them in the waters of Virginia, was held by the Supreme Court of the United States to be valid. "Citizens of other States' said Sawyer, J., **having no property rights which entitle them to fish against the will of the State, a fortiori, the alien, from whatever country he may come, has none whatever in the waters or the fisheries of the State. Like other privileges he enjoys as an alien by permission of the State, he can only enjoy so much as the State vouchsafes to yield to him as a special privilege. To him it is not a property right, but, in the strictest sense, a privilege or favor. To exclude the Chinaman from fishing in the waters of the State, therefore, while the Germans, Italians, Englishmen and Irishmen, who otherwise stand upon the same footing, are permitted to fish ad libitum, without price, charge, let or hinderance, is to prevent him from enjoying the same privileges as are enjoyed by the citizens or subjects of the most favored nation;' and to punish him criminally for fishing in the waters of the State, while all aliens of the Caucasian race are permitted to fish freely in the same waters with impunity and without restraint, and exempt from all punishments, is to exclude him from enjoying the same immunities and exemptions as are enjoyed by the citizens or subjects of the most favored nation;' and such discriminations are in violation of articles 5 and 6 of the treaty with China, cited in full in Parrott's Case. The same privileges which are granted to other aliens, by treaty or otherwise, are secured to the Chinaman by the stipulations of the treaty. Conceding that the State may exclude all aliens from fishing in its waters yet if it permits one class to enjoy the privilege, it must permit all others to enjoy them upon like terms, the same privileges whose governments have treaties securing to them the enjoyment of all privileges

granted to the most favored nation. Again the Fourteenth Amendment of the National Constitution provides that 'no State shall *** deny to any person within its jurisdiction the equal protection of the laws. To subject the Chinese to imprisonment for fishing in the waters of the State, while aliens of all European nations under the same circumstances are exempt from any punishment whatever, is to subject the Chinese to other and entirely different punishments, pains and penalties than those to which others are subjected, and to deny to them the equal protection of the laws, contrary to those provisions of the Constitution. Parrott's Case, 21 Alb. L. J. 388; Strauder v. West Virginia, 10 Cent. L. J. 227."

RECENT LEGAL LITERATURE.

GREEN'S BRICE'S ULTRA VIRES.

The American editor is correct in saying that the attention of the American lawyer is as frequently called to the law of Corporations as to any subject within the range of his professional study. Mr. Green might have added that there are no two words in the law dictionaries and no doctrine mentioned in the text-books, in whose investigation the average lawyer will find so much perplexity and whose study he will rise from with so much doubt, as the words "ultra vires" and the nineteenth century doctrine of which they are the name.

Ultra vires is of modern growth; scarce twenty-five years old in England, it has barely reached its majority here. The creature of judicial decision, and grounded on principles of public policy and commercial necessity rather than of law, it was not long in coming into conflict with more than one firmly established rule of the common law. Of these Mr. Brice gives several extraordinary instances. Broadly the new doctrine was that such acts of a corporation as it had no power by its grant to perform were void. Then came, of course, a conflict. "One of its first onslaughts was upon the time-honored maxim that a man can not stultify himself-that the lunatic, the fool, the drunkard and the knave shall not subsequently repudiate the same, by alleging that neither they nor their agents had at the time sufficient brains or authorization to make it." But this the new doctrine demolished, and corporations were allowed to set up their own incapacity in order to rid themselves of unprofitable bargains. The maxims of equity-he who seeks equity must do equity, and he who comes into equity must come with clean hands-lay in its path, but were quickly broken down, and corporations were relieved from contracts of which they were allowed to retain the benefits. Next the doctrine of the responsibility of a principal for the acts of his agent was overthrown, and corporations were enabled to disavow the acts of their authorized representatives. It was not strange that such inroads on time-honored rules should soon cause inexplicable confusion, and that later courts should hesitate to support a doctrine which had come to raise a suspicion in the public

A Treatise on the Doctrine of Ultra Vires. Being an investigation of the principles which limit the capaci ties, powers and liabilities of corporations, and more especially of joint stock companies. By Seward Brice, M. A., LL.D. Second American edition, with notes and references to Ameriean cases, by Ashbel Green, of the New York Bar. New York: Baker, Voorhis & Co. 1880.

mind that if you should scratch an English judge you Would be sure to find a stockholder.

There is perhaps no subject on which there is a louder call for a good American text-book than the subject of the present work. The English decisions, as Mr. Brice states, are conflicting and sometimes irreconcilable. Thus while it has been held ultra vires of one railroad to run steamers from H, the contrary is held of another to run them from M. It is ultra vires of a steamship company to sell all its vessels but two, but not to sell the entire fleet. It is ultra vires of railroad companies to enter into partnership, but not to agree to divide profits. It is ultra vires of the town of Y to incur expense to obtain water supply, but not of the town of W. These cases sufficiently illustrate the confusion which exists; and the American cases are hardly more satisfactory.

The American work is a large one; Mr. Brice's text being swelled by the American notes and index to nearly 950 pages. It is not often, in this day of many books, that we are able to speak of any treatise as the only one upon the topics treated. But this can be said of the work before us, and we can readily believe that there is no lawyer who is ever called upon to investigate what has now come to be termed "corporation law" who can afford to have his library lacking it. The publisher's work has been well done; and the mechanical execution of the book strikes one as being all that could be desired.

NOTES.

New sitting

When the

A very considerable number of the traveling public will be glad to learn that it has been recently judicially determined that to take a seat in a smoking car, light a cigar and engage in a game of whist is not such contributory negligence on the part of a passenger as will deprive him of an action for an injury received while there, even though it appear that had he been in the not regular passenger car the injury would etc. R. have occurred. In Goble v. Delaware Co., 3 N. J., L. J. 177, decided in the United States Circuit Court for the District of Jersey in May last, the plaintiff was in the car next to the engine, which was divided into two compartments, the first being used for He ocbaggage and the rear part as a smoking car. cupied the second seat from the forward end of the smoking car, with his back to the locomotive, engaged in a game of whist with some friends. collision occurred he was thrown violently forward with such force as to cause him to bite in two a cigar that was in his mouth. In answer to the contention of the company that the plaintiff was guilty of negligence, Nixon, J., said: "It has been suggested that not being in the safest place in the train, the plaintiff must take the consequences of being there. But that is not the law. The railway company is responsible for the safety of its pasprosengers in any place which they have vided for their transportation. If a passenger takes the risk of a ride upon the engine and gets hurt, it is his fault and not the fault of the company, as they have not agreed to carry passengers safely up on the engine. But a smoking car is intended for passengers where they can indulge their tastes and appetite without offending the olfactory nerves of their more fastidious (shall I say more cleanly?) fellow passengers."

ST. LOUIS, JULY 9, 1880.

POSSESSION AS EVIDENCE OF FRAUD.

There is much confusion among courts and law writers respecting possession in a grantor, vendor or mortgagor as evidence of fraud. Some judges, loosely, speak of it as being conclusive, and others as being only prima facie evidence of fraud, but a careful examination of this branch of the law will show that neither of the views so expressed is correct. In the present examination it will be sufficient to take up only the cases which have come before the Federal courts-courts which it is supposed and affirmed have taken the most extreme position of the two above alluded to. The argument deducible from

these is applicable to all cases.

2

The first case to be considered is Hamilton v. Russell.1 In that case the facts were substantially as follows: A bill of sale was made to a relation, of a slave, the vendor continuing in possession and appropriating the slave's earnings. The recording act of the State (Virginia) did not apply to bills of sale of personalty. Russell, a creditor of the vendor, levied under a fi. fa. on the slave and sold the same to satisfy his claim. The vendee sued Russell in trespass. The case was tried before a jury. The plaintiff asked for a misleading instruction, which was refused by a divided court. The defendant asked for this instruction: "that if the slave, George, remained in possession of the vendor, by the consent and permission of the vendee; and if by such consent and permission the vendor continued to exercise acts of ownership over him, the vendee, under such circumstances, could not protect such slave from the execution of the defendant." The facts warranted this instruction and it was given. On appeal, the Supreme Court, relying on Edwards v. Harbin,3 affirmed the decision in the court below. Marshall, C. J., delivered the opinion of the Supreme Court, and he, inter alia, said: "In some cases a sale of a chat

11 Cranch, 309.

2 Compare R. R. Co. v. Houston, 95 U. S. 697.

32 Term Rep. 587.

Vol. 11-No. 2.

sion, appears to have been considered as an evidence, or a badge, of fraud, to be submitted to the jury, under the direction of the court, and not as constituting in itself, in point of law, an actual fraud which rendered the transaction, as to creditors, entirely void. Modern decisions have taken this question up upon principle, and have determined that an unconditional sale where the possession does not 'accompany and follow the deed,' is, with respect to creditors, on the sound construction of the statute of Elizabeth, a fraud, and should be so determined by the court. The distinction they have taken is between a deed purporting on the face of it to be absolute, so that the separation of the possession from the title is incompatible with the deed itself; and a deed made upon. condition which does not entitle the vendor to the immediate possession." He then considers the case of Edwards v. Harbin, where a bill of sale of sundry chattels had been offered to secure a debt, but was refused, unless at the expiration of fourteen days, if the debt should remain unpaid, the creditor was to have the privilege of taking possession of the goods and selling the same for the satisfaction of his debt. The surplus over the debt was to go to the debtor. All of which appears to have been assented to. An absolute bill of sale was made. Here was obviously a secret trust.4

The possession in both of these cases certainly constituted a strong circumstance as indicative of fraud. They were cases in which it would have been impolitic to have allowed the introduction of evidence of good faith which remained wholly a mental condition, not manifested by such acts as would explain the possession, and make the same appear consonant to what the law could sustain. In other words, the possession, under the circumstances, warranted a presumption of fraud, and the trial and appellate courts would probably have set aside any verdict which would have held otherwise. Doubtless, in principle, should any case similar to that of either of these arise, the trial court would be warranted in instructing the jury that the particular possession in that case was one

4 See Lukins v. Aird, 6 Wall. 78.

which the law condemned, irrespective of any actual intention of fraud.5 The distinction between absolute and conditional deeds, which Chief Justice Marshall refers to, is subject to considerable modification in this country as we shall presently see, owing to the existence of registry acts in the United States. The absence of such acts colors extensively the law on this subject in England. But even there the positions herein combatted are not sustained. Had it been shown that the possession in the two cases just considered was accidental, fortuitous or forcibly and illegally obtained, and the other circumstances been consistent with that view, the instruction of the defendant in Hamilton v. Russell, would not have been given. All of which indicate that bald possession is not conclusive evidence of fraud. It is only a circumstance which goes in evidence with other circumstances; and according to the body of acts and facts proven, must be the action of the court in ruling upon the admissibility and inadmissibility of testimony and in giving instructions. Respecting the expressions of Chief Justice Marshall in this case and the expressions of other judges hereafter considered, the remarks of Mr. Bishop seem to be applicable. "The bane of our law is, that when a great judge utters from the bench a pure and neatly cut legal truth as seen in the light of the facts in his contemplation, a small judge or a small law writer, coming after him, stops short of seeing the facts, and perversely bends the utterance to other facts which they do not fit. Thus is the actual truth of the law abused, cast down and trodden in the mire from age to age."7

that case the intent was believed by the court to be fraudulent, and in this case it is admitted not to have been fraudulent. It is contended that all the circumstances from which fraud was inferred in that case, are to be found in this; but the court can find between them no trait of similitude. In that case the deed was of all the property; was secret; was of chattels, and purported to be absolute, yet the vendor remained in possession of them, and exercised marks of ownership over them. In this case the deed is of part of the property, is of record, is of lands, and purports to be a conveyance which, according to its legal operation, leaves the property conveyed in possession of the grantor." The conveyance was held not fraudulent. there was possession continued in the vendor, but the admissible circumstances showed no fraud in the possession. A distinction seems properly to have been drawn between real estate and movable property. But these are only circumstances; for cases are conceivable where the continued possession of premises by a grantor, even after the recording of the deed, may be regarded as fraudulent.9

Here

In re Brooks v. Marbury, 10 there was an assignment for the benefit of creditors. We quote from the opinion delivered by Marshall, C. J.: "It has been also contended by the plaintiff that if possession did not accompany and follow the deed, it is void as to creditors under the authority of the case of Hamilton v. Russell. On this point it may be proper to observe that in Hamilton v. Russell, the deed purported to convey the property to the vendee for his own immediate use, and the subsequent continued possession of the vendor was incompatible with the instrument. This is a deed of trust, not for the benefit of the person to whom it is made, but for the benefit of certain enumerated creditors. The continuance of the possession with the donor until the trust can be executed, may not be so incompatible with the deed as to render it absolutely void under all the circumstances. The court does not mean to express any opinion on this point farther than to say that it is not supposed to be decided in Hamilton v. Russell."

See Lukins v. Aird, ante.

10 11 Wheat. 79.

In Conard v. Atlantic Insurance Com11

pany, Judge Story delivered the opinion of the court, and, inter alia, said: "Without

undertaking to suggest whether, in any case, the want of possession of the thing sold constitutes, per se, a badge of fraud, or is only prima facie, a presumption of fraud, a question upon which much diversity of judgment has been expressed, it is sufficient to say, that in case even of an absolute sale of personal property, the want of such possession is not presumptive of fraud, if possession can not from the circumstances of the property, be within the power of the parties." We have italicized the word 'badge' because this qualifies the doctrine sometimes enunciated and so much relied on, that possession is conclusive evidence, or, as it is sometimes ambiguously expressed, evidence per se, of fraud. This language is, however, somewhat meaningless. What can be meant by 'badge of fraud, per se?' Does it mean the self-contradiction that 'badge of fraud' may be no 'badge of fraud,' or does it mean that a 'badge of fraud is conclusive, and excludes other evidence indicating no fraud? If the latter, then it is not a mere "badge" of fraud; if the former then there is no meaning in the language. The term, per se, is inapplicable in this connection; it conveys no other meaning than that a "badge of fraud" is "a badge of fraud"-something we suppose nobody would undertake to deny.

Robinson v. Elliott12 was a case of a mortgage on a stock of goods, which was left in the possession of the mortgagor, who sold therefrom and took the proceeds; and contained a provision beneficial to the debtor and prejudicial to other creditors. The mortgage had been recorded. It was held void under the statutes of Indiana, and would, doubtless, have been held void according to the authorities relied on, at common law. The transaction was one calculated mostly to benefit the debtor, whatever the actual intention may have been, and so operated to hinder creditors in fraud of their rights. The case of Reed v. Minor13 does not disclose the facts proven. It

appears to have been tried before a jury. Instructions were asked for by plaintiff and

11 1 Pet. 449.

12 22 Wall. 513.

133 Cranch, C. C. 82.

defendant.

It was a case of trespass for levying a fi. fa. upon the plaintiff's property for the debt of Silas and David Reed. The defense was a fraudulent conveyance of property by Silas and David Reed to the plaintiffs, E. and C. Reed. The head note contains the instructions given, and is in these words: "An absolute deed of all the househould furniture, and all the stock in the shoe business, is fraudulent and void as to creditors, unless the possession bona fide accompany and follow the deed; but if the goods, at the date of the deed, were actually delivered to the grantees for a valuable consideration, and then taken possession of by one of the grantors, who was bona fide the known agent of the grantees, and who, as such, received and exercised exclusive possession bona fide, publicly and notoriously, for the sole use and benefit of the grantees, so that the change of possession was notorious and unequivocal, such possession was not inconsistent with the deed, and did not make it fraudulent and void, as to the creditors of the

grantors. But if the possession remained with the grantors jointly, although the said agent was one of the grantors, such possesion was inconsistent with the exclusive possession of such agent, and was not such a possession as gave effect to the deed, as a valid deed against the creditors of the grantors." Presumedly the instructions were applicable to the case. No objection appears showing that they were regarded as misleading or impertinent, and no appeal appears to have been taken. It is not going too far to say that possession under the circumstances contemplated in the defendant's view was fraudulent, i. e., possession together with the other circumstances constituted the fraud. If possession under any and all circumstances was conclusive or even prima facie evidence of fraud, the instruction asked by the plaintiff would have been misleading. Moore v. Ringgold14 is reported very briefly. That appears to have been replevin brought by Moore against Ringgold, who was marshal, for a horse, which had been taken under an execution against one Dunning, in whose possession it was found. The plaintiff claimed the property under a sale from Dunning, who tes

143 Cranch, C. C. 434.